Yangzijiang Shipbuilding - CGS-CIMB Research 2021-09-03: Captain Of The Ship

YANGZIJIANG SHIPBLDG HLDGS LTD (SGX:BS6) | SGinvestors.io YANGZIJIANG SHIPBLDG HLDGS LTD (SGX:BS6)

Yangzijiang Shipbuilding - Captain Of The Ship

  • Yangzijiang Shipbuilding (SGX:BS6) has secured US$534m of new contracts, bringing year-to-date order wins to US$7.21bn and estimated order book to a record of US$9.18bn.
  • Near-term catalyst is clarity in debt investment division spinoff structure.
  • Reiterate ADD rating on Yangzijiang Shipbuilding and SOP-based target price.



LOI declared effective, new order win

  • Yangzijiang announced that the letter of intent (LOI) for 5 additional units of dual-fuel 7,000TEU containerships (with US$500m) has been declared effective. Recall that Yangzijiang Shipbuilding previously reported new order wins on 30 July 2021 for 10 LNG dual-fuel 7,000TEU containerships and the LOI for 5 identical vessels placed by repeat customer Seaspan Corporation. In addition, in August 2021, Yangzijiang Shipbuilding secured an order for the building and delivery of 1 unit of 82,000DWT, estimated to be worth US$34m.
  • Deliveries are mainly scheduled for FY2022-2024. year-to-date, Yangzijiang Shipbuilding has secured 118 effective shipbuilding contracts. Order book stands at ~US$9.18bn.


Slots are quite full; margins could be preserved if steel stabilises

  • Yangzijiang Shipbuilding is currently operating at full capacity till the sale of second-hand bulk carriers to boost net profits.


Near-term catalyst: debt to securities spinoff

  • We believe the potential stake in the debt to securities portfolio while reaping the fruits of strong shipbuilding orders.


Reiterate ADD on Yangzijiang Shipbuilding






LIM Siew Khee CGS-CIMB Research | https://www.cgs-cimb.com 2021-09-03
SGX Stock Analyst Report ADD MAINTAIN ADD 1.910 SAME 1.910



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